Problem
Aerotron Electronics has just bought a used delivery truck for $15,000. The small business paid $1,000 down and financed the rest, with the agreement to pay nothing for the entire first year and then to pay $536.83 at the end of each month over years 2, 3, and 4 (first payment is in thirteenth month).
i. What nominal interest rate is Aerotron paying on the loan?
ii. What effective interest rate are they paying?
iii. How much of the fourteenth month's payment is interest? How much is principal?
iv. How much of the eighteenth month's payment is interest? How much is principal?
v. How much of the twenty-second month's payment is interest? How much is principal?